It’s Identify Theft Awareness Week in the US, and with the Federal Trade Commission reporting that cases of identity theft doubled last year to a frightening 1.4 million, this is something that all of us need to be taking seriously.
One of the reasons for this huge increase is the en masse switch to digital working as a result of Covid-19 lockdown measures and the resulting increase in cyberattacks. In July 2020, Action Fraud in the UK estimated that victims of coronavirus-related scams had lost over £11 million.
The most common cases of identity theft involve individuals posing as someone else in order to buy a product or obtain credit in their name. As none of us want to discover that huge amounts of debt have been racked up in our names, it’s definitely worth taking the protection of our personal data seriously.
Sadly, it’s one of those jobs which frequently gets relegated to the bottom of our to-do lists. As a result, most of us are leaving our digital front doors wide open for criminals with passwords that are laughably easy to hack and minimal protection on our computers.
Here are eight easy ways to guard your financial and personal data and protect yourself against identity fraud:
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Destroy sensitive documents
Invest in a shredder and destroy all personal documents such as bank and credit card statements and receipts before chucking them out to avoid ‘dumpster divers’ getting hold of your data. Yes, people really do go through bins looking for information that can be used to steal identities and commit fraud.
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Be password savvy
We all know the drill when it comes to passwords: long and complicated is best with a mix of letters, numbers, and symbols, avoiding obvious combinations such as 123456, qwerty, or password at all costs. But do you follow the advice? A professional hacker can crack a six-character password in 90 minutes – even one which contains upper and lower case letters as well as numbers – so it really does make sense to use more sophisticated passwords. And make sure you mix them up – the same password for everything is a big no-no.
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Protect your computer
Investing in anti-spyware and anti-virus software for your computer is a must. Keep the software and operating systems on your computer updated to ensure that you benefit from any security patches introduced in the ongoing fight against data thieves.
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Be wary when revealing personal information
Most of us are au fait with the scam calls from Microsoft and emails from Nigerian royalty offering to pay billions into your bank accounts, all they need to gather from you is your bank account number and some other pieces of personal or financial information. But the scammers are getting smarter and smarter, and their trickery is constantly evolving to exploit weaknesses as new tech comes online. The golden rule is to never reveal personal information to unverified sources either online or over the phone. Banks and financial organisations won’t ask for this information. If someone is pressuring you into revealing personal or financial details, theft may be a plausible intent and it would be wise to make further enquiries via trusted channels.
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Monitor your bank accounts
Our consultants are always shocked at the number of people who don’t keep tabs on bank accounts, credit cards and loans. Make it a habit to check statements regularly for suspicious activity, so it can be detected as soon as possible and the necessary steps are taken to secure your data in the case of a breach.
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Destroy digital data
If you’re getting rid of obsolete techs such as old computers, hard drives and other digital storage devices, make sure you erase all personal information, financial records, and details about any existing accounts first. Tools such as File Shredder can help ensure that data is irretrievably obliterated.
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Only purchase online from secure and encrypted websites
Limit online purchases to secure websites which feature the small padlock symbol in the address bar of your browser and/or have a web address beginning https:// (the ‘s’ stands for secure). If a site is littered with poor spelling and grammar and intrusive advertising, it’s probably wise to steer clear. If in doubt, Google is your friend for sniffing out scams.8. Forward mail if you move
When you move house, arranging to have your mail, including utility bills, forwarded for at least six months after your move will ensure that important correspondence doesn’t fall into the wrong hands. It will also flag up any organisations or companies, such as credit card companies, you have forgotten to inform of your change of address and ensure that you get all your admin in order.
All these steps are inexpensive and relatively quick to do but will go a long way to securing your personal data and ensuring that you don’t fall victim to fraud.
What is Identity Theft
Identity theft occurs when someone uses their financial accounts or personal information for their financial gain. The stolen information includes birthdates, names, driver’s license details, addresses, Social Security numbers, and credit card or bank account numbers. The identity thieves may then use this information to commit financial crimes like making purchases, opening a credit or debit card, and even as extravagant as using someone else’s health insurance to get medical care. Fraudsters obtain such information via various mechanisms, such as hacking your online account.
There Are 5 Types of Identity Theft
(1) Financial Identity Theft
Financial identity theft is when identity thieves obtain personal information of another person for their own financial gain. Financial identity theft is the most common type of identity theft and comes in many forms:
Identity thieves use credit card account information to make fraudulent purchases:
Online shopping has become commonplace in our day and age, and the pandemic only worsened the prevalence of fraudulent online purchases. Fraudsters steal credit card information and details of virtually any existing account, and make purchases in your name online.
Identity thieves steal money from your bank account:
The stolen amount may be so small that it goes unnoticed, but identity thieves can build up substantial totals by targeting many people in this way and draining the balances on their debit cards slowly but surely.
Identity thieves can open new accounts with Social Security numbers:
Identity theft may take the form of a new line of credit. The criminals run through the credit and leave you with a substantial credit report that you are responsible for.
Fortunately, you can protect yourself against financial identity theft by frequently assessing your bank accounts, bills, and credit card statements. If you notice any unexplained charges or purchases, contact your credit card company immediately to report identity theft. If your score decreases for no obvious reason, you may be the target of identity theft, and local law enforcement agencies will have to get involved. You also need to notify the Internal Revenue Service to ensure your credit reports and credit scores reflect accurate data. To get a free credit report annually from each of the major credit bureaus, visit AnnualCreditReport.com.
A credit monitoring service is a system that scans your credit record for any indications of fraud, and they will alert you of any unusual activity. If you ever receive such as alert, be sure to take the proper measures as the consequences could be severe.
Additional precautions include placing a one-year fraud alert on all your credit reports to prevent people from opening new accounts using your name. This means that lenders and creditors will have to take additional precautionary measures in order to grant you credit increases or loans. Moreover, you can put a security freeze on all your credit reports, so others are blocked from extending credit.
Some identity thieves execute a type of identity theft known as tax identity theft. The lesser known form of financial crime, Tax identity theft, happens when someone uses another person’s personal information to file a false state or federal tax return to collect a fund.
(2) Criminal identity theft
Criminal identity theft involves a person using a different name from their own when arrested by a local or federal law enforcement agency. They may justify their identity by showing fake information, such as a fake or stolen ID or driver’s licence, to the police. Criminal identity theft may be challenging to detect initially until the consequences start to emerge. Such consequences may arise in various forms, including:
- Someone receives a court summons for a crime they did not commit.
- A bench warrant is issued for a person’s arrest. Some issues like unpaid parking tickets are cause for a bench warrant.
- Police often keep a record of an identity theft victim to act as an alias for the real fraudster. A false criminal record could result in some issues with employment and accommodation.
You can prevent becoming a criminal identity theft victim by meticulously keeping your ID safe. In the case of a missing or stolen driver’s licence or ID, report it to the Department of Motor Vehicles and local law enforcement agencies immediately. Additionally, take caution in the information you share with others online.
(3) Medical Identity Theft
Strange as it may seem, medical identity theft is surprisingly prevalent. Medical identity theft occurs when an identity thief poses as someone else to get health care services. These criminals could use your personal information and insurance details to:
- Gain access to medical services, like expensive surgeries
- Get drug prescriptions
- Gain medical supplies and devices, like hearing aids and wheelchairs
This form of identity theft could result in costly bills of services, prescriptions, and devices that did not involve you in any way. Your health care insurance record may even reflect these purchases. If your medical records are inaccurate, it may be challenging to obtain the required care when you need it.
You can decrease the risk of being a victim of medical identity theft by reviewing your medical claims and records regularly. If you notice any strange prescriptions, procedures, or medical services, contact your insurer immediately. You should also inform your medical provider that you were the victim of medical identity theft so that they can ensure your records reflect correct activities.
(4) Synthetic identity theft
Synthetic identity theft is becoming a fast-growing form of identity theft and involves a person creating fake identities using the personal information of real people. The criminal use information like Social Security Numbers, birthdates, addresses, and names to create an authentic-looking profile. The fraudsters then use these identities to execute various criminal activities for personal gain, such as applying for credit card loans, among countless possible financial crimes.
A crucial part of combatting synthetic identity theft is recognising the signs and reacting as fast as possible. Be especially vigilant of any emails sent to your address but addressing another name. Likewise, keep an eye out for phone calls or emails regarding new credit accounts. Such information can also be obtained via a text message, so be wary if your receive any unusual text messages requesting your financial details or any other personal information. You can take further precautions by checking your credit reports regularly for any unusual charges and then putting a security freeze on the card.
Moreover, you can make use of an identity monitoring service, which scans the internet for data breaches and breached Social Security numbers. If you have any suspicions that either you or a loved one is a victim of identity theft, contact the relevant authorities like the Identity Theft Resource Center and financial institution to help you resolve the matter.
(5) Child identity theft
We can all agree that children need to be protected from adversity in this world. Child identity theft is when a criminal takes a child’s personal information to commit financial crimes, such as opening a new bank account or credit line. The identity thief may even use a child’s information to apply for government benefits, buy a house, and get a driver’s licence.
Using a child’s name is usually less complicated than with adults because children don’t have any records regarding bank accounts or credit reports, so they offer a clean slate.
Regrettably, child identity theft often comes from within the family, as family members have easy access to the child’s personal information like their address and birthdate. Most children only realise they are a victim of identity theft once they get older and try to take out a loan, for example. As a parent, it is vital to be aware and cautious of child identity theft.
The simplest way to check if your child is safe from child identity theft is to check with one of the three major credit bureaus if they possibly have a credit report. You could then place a freeze on the child’s credit report if you suspect any fraudulent activity.
Identity Protection Individually
Identity theft is primarily characterised by a serious data breach. Identity theft is usually made possible when people naively and knowingly transfer login credentials or personal information to identity thieves online. However, identity theft also takes place due to a physically stolen credit card, chequebook, bills, bank statements, and any other identity-related documents.
The most proactive intervention strategy that consumers can exercise is guardianship of identity documents and personal information, as recommended by the US Federal Trade Commission and most other sites that address the issue of identity theft.
Another form of identity theft mitigation is not providing identifications unless absolutely necessary. Consequently, online systems and organisations should not demand an excessive amount of credentials or personal information for authentication. Storing data such as credit card numbers, driver’s licence numbers, and Social Security numbers increases the risk of identity theft if this information is not adequately secured.
Identify thieves even go so low as to steal personal information from the deceased. They find personally identifiable information on death notices and gravestones to exploit the delay between the time of death and the closing of the bank account, and the freezing of the credit card number. These criminals commit fraud and execute many other financial crimes until the family of the deceased identify the crimes and acts to stop them.
There are currently many identity theft protection and insurance services available to protect past individual victims and cautious persons. In exchange for a monthly or annual fee, an individual can receive identity theft coverage to help protect against theft and identify when they have been targetted for identity theft. Such identity theft services operate by setting fraud alerts on a person’s credit files with all three credit bureaus or by monitoring the credit report of the individual.
Organisational Identity Protection
The Federal Trade Commission addressed the issue of Social Security number sales and other types of identity theft in their testimony before the US Senate in May 1998.
The Federal Trade Commission then agreed to the self-regulating principles that stand to restrict access to the information on credit reports. These restrictions vary between the individual categories of customers. The Federal Trade Commission is responsible for taking records of fraud complaints and identity theft complaints.
When organisations don’t exercise proper stewardship of personal information, it could potentially result in unauthorised access to sensitive information and exposure to the risk of identity theft.
Over 900 cases of data breaches have been documented by the Privacy Rights Clearinghouse since January 2005. These breaches stem from US companies and government agencies and result in a total of more than 200 million records that contain personal information and Social Security numbers.
Poor standards of corporate diligence resulting in data breaches include:
- Not shredding confidential documents before throwing them away
- Lack of adequate network security
- Credit card numbers and credentials stolen by agents from call centres with access to recorded calls
- Stolen laptop computers containing extensive amounts of personal information
- Personal information brokerage to other institutions without the reassurance of appropriate security controls

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